Dec 2015

Master of Business Administration (MBA) Examination

I Semester

Business Environment

Time : 3 Hours ]                                   [ Max. Marks : 80

Note : Attempt any four questions from Section A. Each question carries 15 marks and Section B is compulsory and carries 20 marks.

Section A

 1. Discuss the role of environmental scanning in strategic decision making. What are the limitations of environmental analysis ?

2. What is the distinction between science and technology? Comment on the impact of technology on society.

3. Discuss the strategies to be adopted for entering into global markets What challenges may an Indian organisation face, to enter into global markets ? .

4. Discuss the impact of the 'European Crisis' on FDIs globally.

5. What do you mean by Privatisation ? What are its objectives ? What is PPP ?

6. Write short notes on.: (any two)

(a) Public Debt

(b) Monetary Policy

(c) Euro Currency

(d) Elasticity of Demand.

Section B


Kerala gets the highest rainfall in the country. It receives two monsoons - summer and winter - every year. No other Indian state is so lucky with rains. But, the state's environmental groups would rather allow the rainwater to flow down into the sea rather than use it to generate hydroelectric power project that could destroy rainforests, flora and fauna. Some 30 years ago, the government planned to set up a giant hydroelectric power project and would harness this heavy flow of rainwater. Popularly known as the 'Silent Valley Project', it wets meant to export electricity to neighboring power and water-starved states like Tamil Nadu and Karnataka. but it never saw the light of the day in the face of strong resistance from environmental groups and their

persistent legal action. If Co6 had done its homework well, it would have avoided Plachlmada.

It was a huge mistake Coke soon found itself locked in a bitter battle with Plachimada's 'water warriors'. The recriminations flew between the village panchayat (a local self- government), a symbol of India's grass root democracy and Coke, and threw up several basic questions. Firstly, what was the social and economic utility of water guzzlers like Coke in a country precariously short for freshwater resource? Next should there be a strong regulatory framework to discipline water-based non-essential industries like soft drinks and monitor their menacing operations in water-starved locations ? Should India encourage companies like Coke to indulge in reckless commercial exploitation of groundwater, depriving millions of people of their right to clean drinking water? India faces a massive shortage of clean potable water for its people; it Is a universal problem faced by mega-cities like Delhi. Mumbal . and Chennai as well as several hundreds of thoands of villages like Kerala's Plachimada.

There have been several geophysical studies on the earth's proven reserves of freshwater. Coke's own study of global 'water situation' says that by 2025, two-thirds of humanity, Is likely to suffer from amoderate to severe shortage of water. It says that in India, the per capita water availability is only 1,967 cubic metres as against 10,230 cubic metres In the USA. The 'stress factor' applies when the per . capita water supplies drop below 1,700 cubic metres. With 2.45 per cent of the earth's land mass and over 17per cent of its population, India accounts for only 4 per cent of the earth's fresh water resources. By 2025, the freshwater availability in India per head will fall to 1,600 cubic metres.

In such circumstance, it may be interesting to assess the future of water guzzling companies like Coke and how they can avoid compounding the misery of the country's teeming millions, who are thirsty and unclean for want of water. How, many people consume soft drink in India? According to the industry, it is dose to 200 million or less than 20 per cent of its total population. A production of 550 million cases of carbonated water by coke and Pepsi in 2004 would mean the production of over 3,000 million litres of soft drinks. Going by Coke's claim that it consumes 4 litres of water to make 1 litre of soft drinks, this means that the two soft drinks makers would have consumed 12,000 million litres of freshwater during 2..4. Coke's soft

drinks business grew at a phenomenal rate of 27 per cent in 2002 Inclusive of its bottled drinking water, the business growth that year was nearly 40 per cent. Despite the pesticides controversy, Coke's volume growth in 2003 was claimed to be 22 per cent. The bottled water business is fast catching up with the soft drinks business in India. The size of the bottled water business (retail packs) In 2001 was estimated at 185 million unit cases or 1,052 million litres. This business is growing at an exponential rate of 40-50 per cent a year, the introduction of highly popular bulk packs of bottled water, each containing 20 to 25 litres, for in- home as well as institutional 'consumption will further boost the business in the coming years. It is no wonder that coke's Indian operations have come under increasing attack from local communities, especially around its plants that have been accused of exploiting millions of litres of groundwater everyday and fouling the • environment as well.

Questions :

1. Do you think that Coke and Pepsi, have harmed the interests of Indian than benefiting?

2. What can be done to check harmful effects of MNCs operating in India ?

3. Why was Coke allowed to do what it wanted to freely in India

4. Inspite of all the hassles, Coke continues to stay in India and is growing. How could the soft drink gaint face the challenges ?